Chapter 7. Rewarding Innovation: How to Design Incentives to Support Innovation
The Importance of Incentives and Rewards
Incentives and rewards are some of the most powerful management tools available. When Mobil changed its measurement system to support introduction of its new business model, it linked 30 percent of the bonuses of all salaried employees to these metrics. A significant part of Mobil's improved measures tracked the ability of the organization to learn better ways to execute the business model. At the corporate level, measures such as the growth in non-gasoline revenues were used to reflect the value of incremental innovations to the model. At the division level, the company measured new product ROI and new product acceptance rate. ...
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